Should your brand lead with values?
Evaluating the impact of brands’ polarizing values
There’s a way of being in the world that’s ‘all things to all people’. When a person is said to be that way, it’s not typically a flattering analysis. But many—maybe most—companies adopt that way of being. Just as Michael Jordan reportedly said, ‘Republicans buy shoes, too’, many companies studiously avoid making a stand that could alienate any potential customers. The 4A’s, the advertising industry’s association, recently released a report that encouraged brands not to take political or social stances, saying “there’s more risk than benefit”.
New research my company enso, a mission-driven creative company, has published demonstrates how some companies that have taken stands on polarizing issues have alienated some potential customers, but those stands have been rewarded by loyalty from others. For example, Starbucks’ stand on hiring immigrants draws admiration from some, and scorn from others. So should brands take stands on controversial issues? Is the risk worth the reward?
The research we conduct in partnership with Quadrant Strategies, a research firm, asks a nationally-representative sample of the US population which brands align with their values, and which brands they would be willing to publicly, actively support in service of the brands’ missions.
Some brands, like Goodwill, Amazon and Google rank consistently well across different types of people—across political persuasions, age, income levels and attitudes.
But some brands are polarizing.
NPR, NBC and Vice score disproportionately well with people that lean Democrat. Wells Fargo, Coors and Pfizer score disproportional well with people that lean Republican. Trader Joe’s, Uber, Ben & Jerry’s rank particularly well with people that say experiencing other cultures is important to them. McDonald’s, Chevrolet and Marlboro rank particularly well with the Americans that say experiencing other cultures is not important to them.
In other words, many brands represent a set of values that means they align with groups of people who share those values.
Learning from Starbucks’ experience
Starbucks ranks 75th overall in our index of 150 brands. But when we look at how Democrat-leaning people rank brands, Starbucks moves up 57 places to rank 18th. This is the largest upward movement of any brand for people who lean Democrat.
Why does the Starbucks brand lean Democrat? While there are many factors that contribute to to a brand’s perception, Starbucks has been very vocal in championing its values. From actively addressing climate change, to diversifying its supplier base to include more women and minority-owned suppliers, to progressive supply chain practices, to hiring and training veterans, to committing to hire 100,000 at-risk young people. Shortly after the inauguration of Donald Trump, Howard Schultz, Starbucks executive chairman, circulated an open letter to all his staff, titled ‘Living our values in uncertain times’. These actions and statements have generated a massive amount of press coverage.
Starbucks’ official mission statement is, ‘To inspire and nurture the human spirit — one person, one cup and one neighborhood at a time.’
When we asked people to define Starbucks’ mission in their own words, some are clearly offended by Starbucks’ actions: ‘prefer refugees over Americans’; ‘to divide people’; ‘very liberal agenda’. It’s very possible that Starbucks has lost business from people with these views. Among people who lean Republican, Starbucks declines by 28 places to rank 103rd out of 150. People over 55 years old rank Starbucks 36 places lower than the general population.
So how can this be a good thing?
Other people we asked were able to recite the mission almost exactly, while many others reflected the values-oriented practices: ‘to employ veterans and serve lattes’, ‘lead the way in many activism events’, ‘fair trade as much as possible’, ‘to empower people’, ‘help employees go to college’.
Among people who take action in support of issues they care about (which could be online, like signing a petition, or offline, like attending a protest), Starbucks moves up 60 places to rank 15th. In other words, Starbucks aligns with the values of the people that act on their values.
When we look just at Moms, Starbucks moves up 34 places. When we look at those who are higher income and higher educated, Starbucks moves up 47 places. For any brand, these are very important, and influential, audiences to resonate with.
Similarly, looking at people who say that experiencing other cultures is important to them, Starbucks rises 46 places, to rank 29th. Again, Starbucks moves up more places than any other brand when we look just at people with this sensibility.
Consider this: while 64% of those over 55 years of age say that experiencing other cultures is important to them, 77% of millennials do; Starbucks scores well with people of this mindset. Millennials are about twice as likely as those over 55 to have participated in activism or protest; Starbucks scores well with those people. Women control a significant majority of purchase decisions and a fast-growing portion of GDP; Starbucks scores well with women. People who are under 34 and active on social media (posting, not just watching) are disproportionately influential in culture, and they score Starbucks much more highly than older and less socially-active people.
In other words, while Starbucks alienates some people with its values, it wins strong emotional connections with some of the most powerful segments of society, who by virtue of age and influence, will become even more significant over time.
Matt Ryan, global chief strategy officer of Starbucks, has said: “We’re able to see a very distinct market improvement in the store’s comp performance [same-store sales], controlling for all other variables, when partners [employees] believe we’re doing the right thing, values-wise. That’s pretty amazing.” So in addition to winning deeper loyalty from important segments of society, leading with values has a direct impact on employees, which drives financial performance.
Of course, there are approaches to leading with values that are not strongly polarizing. Dove has championed the Real Beauty Campaign for over ten years; it ranked #9 overall in the World Value Index, Moms ranked it as the #3 brand, and it was in the top ten brands for both Democrats and Republicans. It is remarkable that a soap brand, a pure utility product, can have won such significant affection with people such that they are prepared to publicly, actively support its mission, above almost any other brand.
Being divisive for the sake of being divisive is clearly not an admirable quality, or great business strategy. But in these polarized times — when there’s a debate about the foundational principles of our future, there’s a role for principled business leaders. Our research indicates that 79% of Americans believe business can be a force for good, but only 41% trust business leaders to do what is right. Closing that gap is critical to brands’ long term relationships with people. In contrast to the advertising industry association’s position, our research indicates that communicating and acting according with values actually creates value.